EDGEPROP. 31ST MAY: Radium focuses on the development of high-rise residential properties within Kuala Lumpur. Its residential properties include condominiums, serviced apartments, suite apartments and Soho units.
Property developer Radium Development Bhd share price opened at 35 sen on Wednesday (May 31) on its debut on the Main Market of Bursa Malaysia, opening 30% lower than its initial public offering (IPO) price of 50 sen.
At 9.45am, the counter has increased to 40.5 sen but still fell short of reference price. Its trading volume has shot up to 138.84 million shares from an opening volume of 12.03 million shares, making it the most active stock on Bursa Malaysia.
TA Securities Research said it pegged Radium at 51 sen per share, based on an estimated earnings per share (EPS) of 3.5 sen for the financial year ending Dec 31, 2024 (FY2024), and a target price-earnings ratio (PER) of 14.5 times.
Meanwhile, JF Apex Securities Bhd valued Radium at 55 sen — which represents a 10% potential upside to its IPO price of 50 sen — based on an estimated FY2024 EPS of 4.11 sen for the property developer and its peers’ forward PER of 13.5 times.
The highest among the three research houses, Malacca Securities Research set the stock’s fair value at 59.5 sen, pegged at a market-cap weighted price-earnings (P/E) of 18.1 times. “Radium’s forward P/E valuation for FY2024 is at 15.2 times, based on our estimated FY2024 EPS of 3.3 sen,” it said.
Radium’s public tranche of 273 million shares for its IPO was fully subscribed after it received a total of 10,496 applications for 279.12 million shares.
The exercise comprises a public issuance of 868 million new shares or 25% of its enlarged share capital of 3.47 billion shares.
Radium will raise RM434 million in proceeds from its IPO, of which RM171 million is earmarked for the acquisition of land bank and development expenditure, and RM109.3 million for hotel construction.
Meanwhile, a further RM93.9 million is allocated for repayment of bank borrowings, RM39.8 million for working capital, and the remaining RM20 million to defray listing expenses.
Radium focuses on the development of high-rise residential properties within Kuala Lumpur. Its residential properties include condominiums, serviced apartments, suite apartments and Soho units.
In terms of financial results, Radium posted a net profit of RM2.94 million for the first quarter ended March 31, 2023, with an earnings per share of 0.11 sen, alongside a revenue of RM25.29 million the same quarter.
Additionally, Radium posted a profit after tax (PAT) of RM128 million on the back of a revenue of RM472.81 million for FY2019.
In FY2020, Radium’s PAT decreased to RM87.89 million against a higher revenue of RM588.07 million. In FY2021, its PAT then improved to RM101.59 million, but with a lower revenue of RM563.69 million.
For the financial period ended Oct 31, 2022, the company posted a PAT of RM89.58 million, underpinned by a revenue of RM302.01 million.
According to Radium’s pro forma balance sheet post-IPO and utilisation of IPO proceeds, the group will have a net cash of RM323 million or 9.3 sen per share, compared with RM37.15 million or 1.1 sen per share as at end-2021.
Malacca Securities is the principal adviser, managing underwriter, and joint placement agent for the IPO, while CIMB Investment Bank is a joint underwriter and joint placement agent.